Zuma calls for end to strike, protests

President Jacob Zuma delivers his State of the Nation address at Parliament in Cape Town February 13, 2014.

Cape Town - South African President Jacob Zuma called for an end to violent mining industry strikes and street protests and warned of significant risks to inflation because of a weakening rand.

“In no way can we have conflict that destroys the economy,” Zuma said yesterday in his state-of-the-nation speech to Parliament in Cape Town.

“When protests threaten lives and property and destroy valuable infrastructure intended to serve the community, they undermine the very democracy that upholds the right to protest.”

At least 10 people have died this year in about 94 protests by shantytown residents demanding jobs and improved living conditions, according to the Pretoria-based Institute for Security Studies.

More than 70,000 platinum workers have been on strike for higher pay at Anglo American Platinum, Impala Platinum and Lonmin since January 23, costing the producers about $18 million (R198 million) a day in lost revenue.

Two decades after the end of apartheid, support for the ruling African National Congress is waning, with a recent opinion poll showing the party may win less than 60 percent of the vote in elections on May 7 for the first time since it took power in 1994.

“We were disappointed, though not surprised, in that there was not a series of positive forward-looking statements on how the ANC can improve the economy,” Peter Attard Montalto, an economist at Nomura Plc in London, said in an e-mailed note to clients yesterday.

“Everything is basically on pause now until after the election in policy terms.”

Government Success

Zuma, 71, said the protests represented the successes as well as the failures of the government.

“When 95 percent of households have access to water, the 5 percent who still need to be provided for feel they cannot wait a moment longer,” he said.

The rand has lost more than a fifth of its value against the dollar in the past year.

The weaker currency threatens to push inflation higher after it accelerated to 5.4 percent in December, prompting the central bank to raise interest rates last month for the first time in more than five years.

The rand fell 0.1 percent to 10.9731 against the dollar as of 10:35 a.m. in Johannesburg.

“The weaker exchange rate poses a significant risk to inflation and will also make our infrastructure program more expensive,” Zuma said.

“However, export companies, particularly in the manufacturing sector, should take advantage of the weaker rand and the stronger global recovery.”

Jobless Rate

The currency’s weakness was due to “global economic problems” and not government policy, Zuma said at a briefing today televised by the South African Broadcasting Corp.

The government is battling to reduce a 24 percent jobless rate and provide housing to as many as 10 million people lacking proper shelter.

Zuma, who is running for a second term, defended the ANC’s record in government, saying more than 650,000 jobs were created last year, and 15 million people were now employed, the most in the country’s history.

“The unemployment rate still remains high,” he said.

“Youth unemployment in South Africa continues to be of concern, as it is throughout the world. We have to work together as government, business and labor to grow our economy at rates that are above 5 percent to be able to create the jobs we need.”

‘Wrong Narrative’

Still, Zuma said South Africa is a better place to live in now than it was 20 years ago, pointing to lower crime rates and an increase in schools, hospitals and roads.

“The narrative says we have done nothing, we have failed,” Zuma told the breakfast briefing.

“It’s a wrong narrative. We have succeeded. We cannot conclude everything in one day or in a short space of time.”

Lindiwe Mazibuko, the parliamentary leader of the opposition Democratic Alliance, said Zuma was out of touch with the suffering of ordinary South Africans.

“While the president painted a rosy picture of job creation under his tenure, the reality is very different,” she said in an e-mailed statement yesterday.

“Today there are 1.4 million more unemployed South Africans than there were on the day he took office.” - Bloomberg News